Alternative technologies ‘may struggle to compete with lithium-ion’ as duration grows

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Long-duration energy storage (LDES) technologies may have a difficult time competing with lithium-ion over the next decade as the latter’s cost-competitiveness at longer durations increases, possibly even to 24 hours, according to Haresh Kamath, Electric Power Research Institute (EPRI).

Just exactly when long-duration energy storage, including flow batteries like Invinity Energy System’s and ESS Inc’s, will take off is a hot topic. But with lithium-ion battery energy storage systems (BESS) being launched widely at four, six and now even eight hour durations, is there a danger for emerging long duration technologies that developers will just stick with the industry standard?

“They can and then they probably will. As the cost of lithium ion comes down I expect that number (of hours duration) to move out. By the end of the decade, I think that we will probably have cost effective lithium at maybe even 24 hours [duration] systems if they’re needed,” Kamath said.

“My feeling is that many of the other proposed energy storage systems have yet to meet their price targets and they certainly have not met their targets in terms of maturity. And so they’re going to have a tough go competing with lithium ion in the next decade.”

“The only way to really for them to establish themselves is if they are able to offer substantially longer times than lithium-ion. It can’t be eight hours; they’ve got to be competitive at the 20 hour or 50 hour point where, once you get up to those numbers, it’s very difficult for lithium-ion to compete because of the way it scales.”

Because the unit cost of lithium-ion BESS increases proportionally as a systems’ duration increases, larger systems are currently very expensive.

Longer duration battery technologies like vanadium flow and iron flow have a more marginal increase in cost as you increase the duration, and so are more cost competitive as you get to larger system sizes.

Long duration storage companies would agree with much of what Kamath says. Invinity CEO Larry Zulch told Energy-storage.news that talking about long duration ‘hours’ would soon be redundant – soon long duration would mean days, weeks or months of discharge.

Those groups would say it is on the cusp, but why it hasn’t taken off already relates to barriers around upfront cost, regulation, policy and market revenue mechanisms. And the most mature market of California clearly sees a role for technologies capable of discharging for days with US$380 million to support up to 20 long duration storage projects in the state included in its recent budget.

And take off it needs to, according to the Long Duration Energy Storage Council formed last year. It claims that LDES has the potential to deploy 1.5-2.5 TW power capacity globally by 2040: 8-15 times the total storage capacity deployed today. Though it concedes that LDES costs must decrease by 60% for it to be cost optimal.

Kamath appears sceptical of these figures, questioning the broader value proposition of long duration energy storage. “Long-duration storage in general, to me, is a little bit of a puzzle because nobody has, in my view, established that it’s needed and nobody has established that they can satisfy it with any of the technologies that are presently being proposed,” he said.

“Those (long-duration) companies are following the intuition that if you have tons of renewables then why would you not want long duration storage. But it’s not clear to me that the value proposition is there, and it’s not clear to me that the that these technologies that are being proposed will be able to serve that value proposition, even if it is there.”

He adds that EPRI is is doing a lot of research into the area and to demonstrate that the value proposition is there. And he’s no lithium-ion fanatic either, sounding a note of caution on just how popular the chemistry has become for stationary energy storage.

“Lithium-ion batteries are becoming so popular and are being used in so many different ways. Watching that number of deployed systems burdgeon to the degree that it has, it is very interesting to see how that all goes.”

“Especially since we don’t have as much data as we’d like from those systems as to how well they’re working. We have installed a huge number of systems, but it’s not clear how often they’re dispatched, or whether they are being used to the extent that they could be. That data is still not out there and it’s something that would be very helpful to understand if we’re making the right investments or not.”

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